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Investors bought a quarter of US homes sold last year

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Re: Investors bought a quarter of US homes sold last year

#331

Post by missedthecue »

slg wrote: post #131
davidw wrote: post #62

Earlier quoted context omitted.

This article, speaking to your point, is pretty convincing in terms of the data: https://www.vox.com/platform/amp/22524829/wall-street-housin... > The role of institutional investors is still being studied, but the popularity of the narrative strikes at something dangerous: People want a convenient boogeyman and when they get it, they often ignore the structural problems that are harder to combat. Housing undersupply…

Yes, the investors are the symptom and not the cause. They are going where the money leads them. However a big problem with institutional investors is that they also institutionalize NIMBYism. They won't just block housing in a select neighborhood, they will block housing everywhere and they put more pressure on the federal government to ensure that housing is protected as an investment class. Both will contribute to…

"They are treating their home primarily as an investment because that is what they have been told to do their whole life."

It's not some psyop that has duped an entire nation, it's people accurately recognizing that their home is the biggest purchase they will ever make in their life, it's almost completely done with debt, and most don't want to end up underwater.

Re: Investors bought a quarter of US homes sold last year

#332

Post by alexb_ »

mikestew wrote: post #325
alexb_ wrote: post #297

Earlier quoted context omitted.

A lot of what I've seen is people worried about "low quality tenants" (read: people who don't look just like me)

The two tenants within a few houses of us in either direction would fit my definition (and likely that of many other folks) of "low quality tenant": don't bother picking up the beer can out of their yard, don't mow (at all ), loud-ass exhaust on their shitty cars, etc. More of an eyesore than a contribution to the local community, and causing me to realize why HOAs come about. But, yeah, it's all because they have br…

"Eyesores" need a place to live too. And I said "look like me" for a reason: class is a bigger part of this than anything else.

Re: Investors bought a quarter of US homes sold last year

#333

Post by heleninboodler »

alexb_ wrote: post #297
giantg2 wrote: post #269

Earlier quoted context omitted.

"Sure, many object to new housing for reasons like "it will change the character of the neighborhood". But many others object because they are worried about the value of their own home going down." At least in my area, it's all about people wanting the area to remain semi-rural. They generally aren't opposing low density SFH in independent builds. The people in my area are against many development and medium density…

A lot of what I've seen is people worried about "low quality tenants" (read: people who don't look just like me)

That feels like a pretty cheap and dishonest dismissal to me, since in my extremely-homogenous neighborhood, all the "low quality tenants" do look just like me.

Re: Investors bought a quarter of US homes sold last year

#334

Post by ryukafalz »

ROTMetro wrote: post #305
davidw wrote: post #98

Earlier quoted context omitted.

There are reasons for that, but they are generally bad ones involving people not wanting to live near other people who look like the author of the article, even if they won't say that part out loud. Higher density housing is a massive component of building lower carbon footprint cities, as well as making our cities more financially resilient. It's also something that can increase equity a lot by giving people with lo…

I don't want higher density for the same reason I don't go on vacations on cruise ships and don't use public transportation. People are gross and assholes. The more people the more chance of tragedy of the commons, and once it sets in it is hard to stop. Most college educated Americans lived in college dorms, and went on to NOT want to live in shared building environments. It's not about racism, it's about not wantin…

You don’t have a property right to your neighbors’ properties. Your neighbors do.

Re: Investors bought a quarter of US homes sold last year

#335

Post by linguae »

nineplay wrote: post #200
danenania wrote: post #168

Earlier quoted context omitted.

I think the core of the problem is that we're losing the middle class of housing. Obviously the nicest areas of the country, with the best weather, most opportunities, low crime, elite schools, etc. are going to be expensive. But it's getting to the point where it's prohibitively expensive for a middle class family just to live in a place without high crime/drug addiction/homelessness, reasonably good schools, reason…

Housing values in and around Silicon Valley have gone up extraordinarily since I was young for reasons that were not easily predictable. It's not a good model for housing costs in the rest of the US. I grew up in uninteresting towns in Monterey County and San Bernardino County and both could check off points of 'acceptable places to live' which are affordable to the middle classes. No one talks about them because no…

And even now these places are starting to become unaffordable for the middle class. I had an unsuccessful search last autumn for homes in Watsonville and northern Monterey County under $550,000 due to bidding wars that often resulted in homes selling for considerably more than asking. Prices are now starting to drop and inventory is rising, but interest rates are considerably higher than last fall when I started my search.

There’s been an explosion in home prices in the California Central Valley since the pandemic started. In 2019 it was possible to buy a brand new house in Los Banos and Merced for $280,000 and $250,000, respectively. Today you need around $450,000 and $400,000, respectively, to purchase similar new homes. And it’s not just the cost of materials that led to the massive price hikes; the cost of pre-existing homes also boomed in these towns.

I grew up in Sacramento and now rent an apartment in Santa Cruz County. Sacramento, once known for affordable housing with easy access to Bay Area and Tahoe amenities, is no longer affordable for many people. There are massive homeless encampments that I see whenever I visit the area these days. The housing situation is getting out of hand, and while this may not be indicative of a national crisis, in California the crisis has spread outside of the coast.

Re: Investors bought a quarter of US homes sold last year

#336

Post by onlyrealcuzzo »

notch656a wrote: post #318
onlyrealcuzzo wrote: post #278

Earlier quoted context omitted.

> For the most part others didn't get that hot of a deal. How? Dollars are worth $0.5 in 1990. Yet your mortgage payment is unchanged. Your house payment is much less. Rents are much higher. You won.

>Housing prices exploded to compensate for the negative real interest rates. They didn't "win." They broke even. The people that sold them won. The people with no house but inflated away cash/salary lost.

If your payment is massively lower than your rent would be - you won.

Someone else is allowed to win, too.

It's a zero sum game, and the only losers have been renters.

That can change if there's a massive, sustained housing crash. But I won't hold my breath for that.

I'm willing to bet, like always, house prices won't decline. The value of the dollar will decline instead (because the Fed can just easily QE until the only people that lose are renters).

Re: Investors bought a quarter of US homes sold last year

#337

Post by iav »

ineptech wrote: post #298
sillystuff wrote: post #12

In 2012 I was looking at investing in REITs. One REIT's pitch was that they owned such a large percentage of the rental housing in Tampa Florida, that even though vacancy rates were high, and rents were going down throughout the nation and other areas in the state of Florida, they were able to keep rents high in Tampa. Disgusted, I realized the harm that REITs and private equity are doing to housing markets, and want…

I agree, and I feel like limiting the mortgage interest deduction to owner-occupied homes would get us most of the way there at the stroke of a pen. It's a huge subsidy and I can't think of any good reason to extend it to rentals and investment properties. In fact, we should probably repeal it altogether - in theory it subsidizes home ownership for the poor and middle class, but in practice the only people who take i…

Not sure if you are aware, but all forms of interest expense is tax deductible for corporate income tax purposes in the United States, not just mortgage interest. This conforms to codes in other countries. There is no subsidy that is specific enough to rentals or investment properties. And since most of corporate bank lending is secured by all assets (including real estate), mortgage debt is somewhat fungible with other secured corporate debt, so it would be pointless to try to tax one but not the other.

Re: Investors bought a quarter of US homes sold last year

#338

Post by jiveturkey »

inetknght wrote: post #63
_fat_santa wrote: post #38

Earlier quoted context omitted.

Seems everyone that bought a home for anything other than living in it. In the article they even mention: > The CoreLogic data shows that what it calls “mega” investors, with a thousand or more homes, bought 3% of houses last year and in 2022, compared with about 1% in previous years, with the bulk of investor purchases made by smaller groups. So most of the percentage increase is done by mom-and-pop investors rather…

> There's a massive gap between someone being able to afford $1200 in rent and being able to afford a home with all of the added costs. Having recently bought a home, I think there isn't so much of a gap and in many cases the gap is inverted: it's cheaper to buy than to rent.

GP is pointing to the economy of scale that comes with apartments in denser urban and surrounding areas. there’s a floor price for home ownership.

Re: Investors bought a quarter of US homes sold last year

#339

Post by notch656a »

icelancer wrote: post #229
aprdm wrote: post #69

Earlier quoted context omitted.

The concept of credit score isn't something that has always existed in humanity. It's something that we can go on without, even more so given the ridiculous profitability of banks

Like IQ tests, the credit score has egalitarian roots, but modern day activists think they're discriminatory and should be abolished.

Credit score is hilarious. Until I was like 30 I paid for literally everything with cash. Everything. Never missed a bill. My credit report/score came back "unreportable." Not a shred of data to go off of. I was unable to obtain any credit card. I ultimately had to go to a bank and place $1500 in what was basically a 0% CD for the duration of my credit card, with the agreement my bank would just take it if I didn't pay. After a couple of years of paying that religiously they allowed me to unsecure the funds, but I still had shitty credit afterwards.

Re: Investors bought a quarter of US homes sold last year

#340

Post by Bukhmanizer »

desperadovisa wrote: post #164
paxys wrote: post #132

Earlier quoted context omitted.

This is such a twisted framing of the issue. No one wants to "abolish property ownership". In fact housing proponents want the exact opposite – give everybody the opportunity to own a house rather than a select few large corporations and investors. Let me build my own house on a piece of land in or near the city, just like my grandparents did just a couple of generations ago. Remove years worth of excessive permits,…

Sorry but with all due respect, "too bad, go live in the middle of nowhere" is absolutely an acceptable answer. You're acting like you're entitled to live where ever you want, but the simple reality is that this is not possible. You need to come to grips with that objective fact.

This is a pretty silly response. Are people entitled to live wherever they want? No. But the situation is very obviously not that black and white. We allow many things in society that people aren't entitled to, largely because we believe it will build a better society.

Am I entitled to own my investment properties? No.

Am I entitled to block neighbouring housing from being built? No.

But society allows both of these things because they ostensibly should result in a better society. Of course, they may not, and if they don't result in a better society, we should probably turn the dial back on these factors, but not get rid of them altogether.

So should anyone be entitled to live anywhere? No. But should a middle-class person be able to build a life in places where there are opportunities for job growth (and like it or not, right now, that's the big cities)? Probably, if we think that will result in a better society. So we may need to turns some policy dials to ensure this will happen.

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